7.4% Dividend From A Safe-Haven Bank – Nordea Bank AB ADR (OTCMKTS:NRBAY)

Nordea (OTCPK:NRBAY) is, for those unfamiliar, the biggest pan-Nordic banking group, having market shares of 15-30% in each of the four Nordic countries: Denmark, Finland, Norway, and Sweden. According to Global Financial Magazine, Nordea was ranked as the 29th safest bank globally in 2017. The ranking was based on the long-term foreign currency ratings issued by Fitch Ratings, Standard & Poor’s and Moody’s Investors Service.

Source: Company data

Another indicator of its safe-haven status is the fact that Nordea’s junior subordinated bonds, or the so-called CoCos, are trading at just a 3.4% yield. For comparison, JPMorgan’s (JPM) CoCos are trading at a 5.5% yield.

Source: Bloomberg

Nordea has recently reported results for the fourth quarter. Even though the company’s EPS missed the consensus by only 1.5%, the market reacted very negatively to the numbers. The stock has fallen by more than 5% since the results release, and one of the local brokers have downgraded Nordea…

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